A revised outlook for Bridgeport, Conn., to stable from negative from Fitch Ratings, reflects the city's strong management team, said a spokesman for Mayor Joseph Ganim.
"This is a very solid bond rating for the city of Bridgeport that reflects what the other two rating agencies, Moody's and Standard & Poor's, have found," said Av Harris, director of communications and senior advisor for public policy. "Namely, that though we do have some financial challenges, we have a strong management team in place, we have balanced city budget and erased a $20 million deficit in the last fiscal year through a combination of cuts and expenses and innovative ways to raise revenue."
Fitch on Nov. 15 elevated its outlook while affirming its A rating for Bridgeport's general obligation bonds. S&P Global Ratings and Moody's Investors Service assign A and A2 ratings, respectively.
"The revision," said Fitch, "reflects management's recent efforts at budget stabilization and Fitch's expectation for gradual improvement in reserves."
The city still has its work cut out, Fitch added.
"Bridgeport's financial flexibility remains limited as evidenced by its low level of liquidity and continued reliance on short-term cash flow borrowing. Management has addressed structural budget issues through a combination of expenditure cuts, asset sales and debt restructurings, but Fitch expects future costs associated with employee salary, health and retiree benefits to continue to pressure the budget."
If projections hold, said Harris, the city expects to complete the 2017 fiscal year with a small surplus that Ganim has committed to depositing into financial reserves. "This puts us in a strong position for borrowing and should have a positive impact on the interest rates we receive once we go to market," said Harris.
